Thursday, June 12, 2014

Telsa hasn't really open-sourced their patents

Today my twitter feed was full of the announcement that Telsa is "open-sourcing" its patents. This isn't precisely true.

For large companies, patents are primarily defensive. Large companies can't sue other large companies without getting a counter-suit in return. Large companies can't sue small, fast growing startups either, because lawsuits drag on for years, and the startup will have either succeeded or failed on its own merits long before the suit is resolved.

Patent lawsuits aren't profitable. Companies specialize in a business. If their business is building cars, then their business isn't suing people. They aren't going to be efficient at it. Most money they earn will go into lawyer fees. And it will distract the CEO and executives from what they should be doing, building cars. If a lawsuit increases profits by 1% but costs 10% of the CEO's time, then it isn't worth it. That's why most patent lawsuits you hear about are from patent trolls -- companies who specialize and profit solely from suing people.

Thus, Tesla wasn't going to sue anybody anyway, except in defense, and the recent statement doesn't change that. That's the "good-faith" code in their statement: "Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology". They'll still sue those using patents in "bad-faith", meaning, defensively counter-sue people.

While Tesla doesn't profit from patents, it does profit from government handouts. Thus, the statement claiming to do what they were going to do anyway: it helps them get more government handouts. Lefties in congress won't give money to "greedy" corporations, but will give lots of money to corporation who appear to be not "greedy".

So the upshot is this: Tesla hasn't put their patents in the public domain, they'll still use them in defense. The announcement is for PR purposes, and doesn't really change their policy at all.